Diagnostics & Imaging Week Executive Editor
Fluidigm (South San Francisco) has entered this year's shallow initial public offering waters, filing with the Securities and Exchange Commission for an IPO of its common stock.
The number of shares to be offered, all to be sold by the company, and the price range have not yet been determined but set a figure of $86.3 million to calculate a registration fee.
Fluidigm manufactures Integrated Fluidic Circuit (IFC) systems for life science research that integrate liquid handling functions on a nanoliter scale to perform assays with minute volumes of reagents and samples.
The company says that its IFCs "can meter, combine, diffuse, fold, mix, separate or pump nanoliter volumes of fluids with precise control and reproducibility, many thousands of times — all in parallel on a single chip." This allows its customers "to perform thousands of sophisticated biochemical measurements on samples smaller than the content of a single cell, with minute volumes of reagents, in half the area of a credit card."
Product applications include its BioMark system for gene expression analysis, genotyping and digital PCR, and its Topaz system for protein crystallization.
The company said it will use the proceeds from the offering to grow its sales force, commercialize its products, continue R&D, expand its facilities and manufacturing operations and for working capital and other general corporate purposes. It said it may also use some proceeds for future acquisitions.
As of Dec. 29, 2007, the company had an accumulated deficit of $133.8 million, primarily the result of R&D costs. And it says that it expects that "selling, general and administrative expenses will increase due to the additional operational and reporting costs associated with being a public company."
In 2007, Fluidigm's loss widened to $25.5 million, from $23.6 million in the prior year. The company's revenue increased to $7.3 million, from $6.4 million in 2006.
Fluidigm acknowledged that it expects to incur losses for the foreseeable future and that it has identified significant deficiencies in its internal control over financial reporting.
Among risks cited by the company in its SEC filing, it cites a slow marketing and sales cycle.
It says that its customers typically get "input from one or more scientific evaluators as well as a review by personnel with finance or operational expertise. As a result, during our sales effort, we must identify all persons involved in the purchasing decision and devote a sufficient amount of time to presenting our systems to those individuals. The newness and complexity of our products often requires us to spend substantial time and effort assisting potential customers in evaluating our instruments including providing demonstrations and benchmarking our products against other available technologies."
The company was founded by Gajus Worthington, its president and CEO.
Morgan Stanley is serving as the IPO's lead underwriter. UBS Securities and Leerink Swann are also underwriting the offering.
After getting the green light from FDA to begin patient enrollment in a Phase III multi-center clinical study of Lymphoseek, Neoprobe (Dublin, Ohio) has completed the closing of $3 million in financing from Platinum Montaur Life Sciences.
Neoprobe said it would use the funding to begin its Phase III clinical studies of Lymphoseek in patients with breast cancer or melanoma and head and neck squamous cell carcionoma. A radioactive tracing agent, Lymphoseek is being developed for use in connection with gamma detection devices in intraoperative lymphatic mapping procedures, the company noted.
Neoprobe reported that FDA has agreed with its plan to begin patient enrollment in a Phase III multi-center clinical study to evaluate the safety and efficacy of Lymphoseek. The company said it plans to enroll about 200 patients at up to 25 cancer treatment centers in the U.S. and Europe.
The funding was committed to the company as part of a $13 million financing agreement with Montaur, which Neoprobe reported signing in December.
The $3 million funding is in the form of a secured note due in December 2011, fully convertible into Neoprobe common shares at 36 cents a share. In addition, Neoprobe issued Montaur a warrant to buy up to 8,333,333 shares of its common stock at 46 cents a share.
"To date, the clinical and preclinical results that have been completed demonstrate the benefits of Lymphoseek," said David Bupp, Neoprobe's president.
The company expects to begin patient enrollment in the first Phase III clinical study soon after the FDA-approved clinical protocol and associated material receive final clearance from review committees of the investigational sites, Bupp said.
Neoprobe said it also is preparing for a second Phase III trial to involve less than 200 patients with head and neck squamous cell carcinoma. The study is proposed to be conducted in patients undergoing full nodal dissection for the staging of head and neck squamous cell carcinoma and is intended to validate Lymphoseek as a lymph node targeting agent for use in intraoperative lymphatic mapping procedures, the company said. The second Phase III trial is expected to begin around mid-year.
Originally, Montaur had agreed to another $3 million in financing once enrollment of 200 patients in the Phase III studies of Lymphoseek was complete. However, Montaur and Neoprobe have modified that prerequisite milestone. Now, the company will receive the final $3 million upon obtaining 135 lymph nodes in the Phase III trial of patients with breast cancer or melanoma.
The first funding of $7 million was also in the form of a secured note, due December 2011, partially convertible at the option of Montaur into shares of Neoprobe common stock at 26 cents a share.
Neoprobe develops oncology and cardiovascular surgical and diagnostic products.
In other financings:
• VisEn Medical (Woburn, Massachusetts) reported a $5 million expansion of its Series B round, which initially raised $7 million in November, bringing the financing total to $12 million. Merck Capital Ventures and Flagship Ventures co-led the expansion. The company said it would use the additional funds to further advance its fluorescence in vivo imaging product pipelines and to expand its commercial applications and customer support of its marketed products.
• Vitro Diagnostics (dba Vitro Biopharma; Aurora, Colorado) reported the initial distribution of stem cell-derived human beta islets to prospective customers. This was a condition to the exercise of warrants held by a group of private investors that will result in an additional infusion of capital into the company, it said.
The distribution was made with the goal of stimulating sales of the company's stem cell-derived products to these prospective customers.
"[T]he anticipated additional capital infusion should allow us to continue the ongoing expansion of our manufacturing capacity, including: moving to a new facility, purchase of state-of-the-art equipment and pre-clinical studies of effectiveness," said Jim Musick, Vitro's president/CEO. He added that the company intends to use its available resources to leverage its technology for production of human pancreatic beta islets from stem cells "into the first firm to commercialize high-quality human beta islets that are consistently manufactured to exacting industrial standards."
The holders of 1 million Class A warrants are now obligated to exercise these warrants at $0.125 per share, potentially resulting in gross proceeds of $125,000 to the company for the sale of 1 million shares of common stock and 500,000 Class B warrants to these investors. The Class B warrants grant the holders the right to purchase an additional 500,000 shares of company stock at 25 cents per share under specific terms and conditions.
• Health services company SoloHealth (Duluth, Georgia) said it has secured $1.8 million in financing from private investors, including the Atlanta Technology Angels investment group. This is the company's first round of outside financing.
The company said the proceeds from this investment will provide it with the working capital to continue to validate its model in a number of additional market locations over the remainder of the year.
SoloHealth's initial product, EyeSite, is a self-service vision-testing kiosk for use in high-traffic retail environments. The system provides a free customized vision report and then directs consumers to an eyecare professional nearby.